Still Minding the Gap: An Assessment of Canada’s Greenhouse Gas Reduction Obligations

With the signing and expected ratification of the Paris Agreement and the conclusion of the first round of federal-provincial and territorial negotiations on a national climate plan expected in 2016, now is a good time to take stock of Canada’s greenhouse gas (GHG) emissions trajectories, and importantly, ask what federal-provincial and territorial promises may deliver on the way to achieving Canada’s GHG aspirations.

We’ve been asked to use modeling and analysis to provide a touchstone for discussion about what Canada’s collective GHG emission trajectory might look like, what current policies are delivering, and what the raft of announcements bracketing the Paris conference are likely to deliver in terms of emission reductions. This short brief presents the first phase of a modeling initiative to take stock of Canada’s GHG aspirations versus emission trajectories. Phase 2 will identify areas where the federal government and the provinces and territories can potentially work together to deliver policy aligned
with long-term decarbonization aspirations.

We ask a simple question, but one that is loaded given the lag in political will we have witnessed in Canada over the years: what would Canada’s emission trajectory look like if the federal government and the provinces and territories implemented their policies as announced? We are generous in our interpretation of these promised policies but also realistic in how we assess the potential. We make clear where policies are already delivering reductions, what policies under development are likely to deliver, and also which policies are less certain. Brought together in an integrated macroeconomic modelling framework, these policies provide a view of Canada’s progress toward the 2020 and 2030 greenhouse gas reduction (GHG) targets.

We estimate that the current gap to the 2020 target is 76 Megatonnes (Mt) and 91 Mt in 2030. We conclude that current Canadian GHG mitigation policies can deliver significant reductions that will increase over time, with the raft of developing policies bracketing the United Nations Paris climate conference having the potential to further lower emissions. However, gaps in policy coverage in some jurisdictions remain that will limit Canada’s ability to close the gap to our 2030 target of 30% below 2005 levels.

There is, therefore, scope for the federal Government and the provinces to work together to better align policy. A first priority includes reducing costly distortions within the federation caused by misaligned carbon policies. The federation can then look for ways to ramp up policy stringency to position Canada for long-term, cost-effective decarbonization.